CH176540 - Sanctionable conduct by tax advisers: determining sanctionable conduct: meaning of loss of tax

Bringing about a loss of tax revenue means causing a client to:

  • Account for less tax than they are required to account for by law
  • Obtain more tax relief than they are entitled to obtain by law
  • Account for tax later than they are required to account for it by law, or
  • Obtain tax relief earlier than they are entitled to obtain it by law.

‘Tax relief’ includes:

  • any exemption from, or deduction or credit against or in respect of, tax, and
  • any repayment of tax.

In other words, bringing about a loss of tax revenue means causing a client to act unlawfully in respect of their tax affairs. This may be by declaring too little tax, filing tax returns late, claiming too much tax relief, or claiming tax relief early.

HMRC publishes extra-statutory concessions (ESCs) to clarify the tax treatment in certain circumstances. For the purposes of tax adviser sanctionable conduct at least, acting in accordance with an ESC means acting in accordance with the law.

FA12/SCH38/PARA3

FA12/SCH38/PARA37 as amended